Mutual Fund: Investing Rs 10,000 every month for 6 years turned into Rs 11.73 lakh, know how

Mutual Fund: An investment of Rs 10,000 every month for 6 years in this mutual fund has directly become Rs 11.73 lakh. For those who invested lump sum, the annual return has been 15.15 percent since inception.

Mutual Fund: Baroda BNP Paribas Mutual Fund’s Balanced Advantage Fund (BAF) has achieved a significant milestone. This fund, which will complete 6 years in November 2024, now manages assets under management (AUM) of more than Rs 4,000 crore. Meanwhile, investors who have invested Rs 10,000 in the fund under SIP since its launch in 2018, their Rs 7.20 lakh has increased to Rs 11.73 lakh by October 2024.

This represents a compounded annual growth rate (CAGR) of 16.12 per cent, which is better than the benchmark Nifty 50 Hybrid Composite Debt 50:50 index, which delivered a CAGR of 12.62% during the same period.

The fund outperforms its benchmark even in shorter periods

• 1 year: SIP return CAGR of 15.79% as against 12.37% for the benchmark.
• 3 years: SIP CAGR of 17.10% as against 12.55% for the benchmark.
• 5 years: SIP CAGR of 16.41% as against 12.75% for the benchmark.
• 1-year return of 26.45 per cent

Meanwhile, for lump sum investors, the fund’s annual return since inception has been 15.15 per cent, which is much higher than the benchmark’s 12.58 per cent. Apart from this, the one-year return in the short term is 26.45 percent, which is about 8% more than the benchmark.

The mutual fund house said that the fund uses a proprietary model to allocate assets between equity and fixed income to take advantage of market volatility. It also uses derivatives to capitalize on the difference in value in cash and future markets.

The equity portfolio includes large-cap, mid-cap and small-cap stocks to diversify. At the same time, debt investments focus on high-credit-quality instruments to ensure safety and stability.

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